1.4.4 Debt Owed to the PHA

PHAs will often reject applicants who owe debts to the PHA. In Louisiana, actions to collect rent or debts on an open account have a 3-year prescriptive period.1  If an applicant formerly lived in public or Section 8 housing and has a debt older than 3 years, the debt has prescribed and cannot serve as a valid basis for rejection.

PHAs (sometimes) and private third-party operators (often) will report debts against former tenants that include contested damages and other charges. To tackle this issue, the tenant may present evidence to the new PHA that the charges are invalid, challenge the charges directly with the previous PHA, contest the charges through a dispute with the credit reporting agency, or even sue to reduce or settle the reported debt. Note that PHAs report debts to the PIH Information Center (PIC) in addition to traditional credit reporting agencies. Other PHAs can see the debt through the PIC system.

• 1La. C.C. art. 3494.